As the world economies revive from a gasping recessionary phase, the political outlook has been to muster up support of the strong few and impose their propaganda of a new economic world order on the majority developing nations. The World seems divided after the debacle of the World Financial Markets and has entered into a subdued Cold War blame game. This article aims at enlightening its readers regarding certain facts that have been raised many-a-times at international conclaves/summits and directed by the developed few at the developing many.
Since the onset of the financial crisis that emanated from the U.S. Housing bubble in 2007 and soon spawned into an Economic crisis by early 2008 the global leaders have unanimously reached a consensus to stimulate their economies via fiscal stimulus packages but this fiscal boost has been realised to achieve very little in terms of sustainable development. Sustainable development means an increase in the Total Factor Productivity bearing in mind the necessity to maintain the ecological balances in terms of energy sources, forest degradation, water sources and food sources. A compromise on any of these mentioned facets would simply imply a short term gain compromising with the future of our future generations.
It took the carnage of the world financial markets to bring the world closer and strive for stringent financial market regulations, transparency in transactions and stronger and liberal bilateral relations. It was at the BRIC and SCO summit in May ’09 at Yekaterinburg, Russia that the Global world leaders acknowledged the important role the developing nations like India/China would play in reviving and shaping the World economic outlook. Issues such as Climate change and carbon emissions have been repeatedly tabled at the international conclaves such as SCO, BRIC, G20 and G8 summits’ where industrialised nations try to bargain with the developing nations on the issue of carbon emissions and thus try transferring their social obligations on them.
It has been argued correctly by the lot of developing nations like India, China, Brazil, South Africa and Mexico known as the G5 that the G8 cannot simply shy away from their obligations of curtailing their carbon emissions and seek promises by the G5 of greater co operations on the same. It has been rightly put forth by the lot of G5 that the developed nations cannot arm twist the developing few on the issue of Carbon Tax viewing it as a protectionist measure. Furthermore, at the WTO talks at Doha, developed nations have been working for greater economic and bilateral relations, financial regulation, and fiscal prudence on one hand but bargaining protectionist measures such as Non-Agricultural Market Access (NAMA) on the other hand.
“When you climb the ladder of success, make sure it is leaning against the right building”.
Economics is neither a science nor an art. It imbibes the beauty of both. Economist constantly strives to find the most appropriate reasoning for a certain happening. Just as a business cycle has four stages of boom, slowdown, recession, depression, the same way economic theories have to be customised to cater to these different phases.
I believe that the outlook of the World Nations has not been unanimous and unless and until a conspicuously unanimous decision is achieved, the hoard to quell and blame the other would continue.
India’s resilience and a policy of nuclear deterrence has its own admirers in the international community and has helped India clinch the 123 agreement and negotiate strongly on the issue of ENR technology. The same can be stated as a reason for its bold stance at the DOHA summit which resulted in an impasse thus sending a strong signal to the global community of its presence and rising stardom.
At the recently concluded NAM summit at Sharm-Al-Sheikh, Egypt, the leaders of developing nations like Raul Castro of Cuba and Hugo Chavez of Venezuela stated bluntly that it is the developed nations’ intentions to slowdown the pace of industrialisation in their country and are thus threatening with the imposition of Carbon Tax. Fidel Castro has been emphatic in his stance on Carbon emissions and has pledged his cooperation if and only if the developed nations like U.S, U.K and Australia pledge to play their role actively and not politicise the matter by passing on the responsibility to developing nations.
Clearly the World Order seems to be divided on grave issues that threaten the very existence of Homo sapiens and this bias would continue to thwart any peace process the nations would try to foster. It is also reasonably argued by some economists that this economic divide would not merely hinder efforts of sustainable development but may also trigger off a new arms race as the developing nations try to make their presence felt on the world map. They further argue that the developed nations rather than implicating the lot of developing few should acknowledge the importance of their participation if a New World Order has to be realised as the team is as fast as its slowest member.